6 causes of financial problems and how to solve them – GOBankingRates | Vette Leader

Geber86/Getty Images

So many Americans are in debt and underfunded for retirement that one has to ask, “What’s going on? Why are so many of us in such financial trouble?”

Here it is: Our Small Business Spotlight 2022
Discover: 7 surprisingly easy ways to achieve your retirement goals

Much of this is not our fault and is out of our control, but we need to get to the bottom of our money issues can Control. Therefore, it is important to understand the causes of financial problems. What are they and how do they manifest? More importantly, how can we solve them?

Bonus offer: Open a new Citi Priority Account by 9/1/23 and earn up to $2,000 cash bonus upon completion of required activities.

Let’s find out.

Financial illiteracy

Financial literacy is severely lacking in our society and causes major problems in our financial lives.

“If you remain in the dark about certain financial factors, you’re ultimately going to be exposed to myriad financial problems,” said Clint Proctor, editor-in-chief of Investor Junkie.

It may not be your fault that you lack financial literacy, but it is your responsibility to fix it. You might want to hire a financial advisor for intensive one-on-one help, but you can also read a growing list of books and podcasts to learn more.

Have a negative mindset

Seeing the world through rose-tinted glasses will not only lead you to financial success, but the reverse mindset can downright hurt you.

“Behind many common financial problems lies a disabling holding of money,” says Kelley Holland, a financial empowerment coach. “This can manifest itself in negative self-talk, like ‘I’m hopeless with money,’ or ‘I’ll never be able to retire.’ It can also show up as avoidance: not opening incoming invoices, not tracking expenses, or missing payment deadlines.”

Offer life insurance: Immediate coverage upon approval. Get an offer in seconds and apply online in minutes. No medical ever – Ages 18-60.

There are a few ways to address negative money attitudes, including challenging your beliefs and acknowledging your own strengths and past accomplishments.

“Think about whether your beliefs are correct — or whether you really have strengths or experience that you can draw on to take charge of your finances,” Holland said. “For example, if you’ve successfully implemented a fitness program, you can reflect on the memories and motivators that drew you into it.”

Take our poll: Do you think you can retire at 65?

Getting bad advice from so called “experts”.

“Our current marketing landscape makes it difficult for people to get financial help they can trust,” said Josh Richner, marketing coordinator for the National Legal Center. “Ad platforms are creating new ways to target audiences with aggressive advertising, but the information isn’t always transparent or accurate. The more profitable the service, the more companies can afford to market it. That’s a catch-22 when we’re working with people who are struggling.”

Offer life insurance: Pricing starts at just $10/month. No medical ever – Ages 18-60. Get your quote in seconds and coverage in minutes if approved.

To resolve this issue, Richner recommends that you consult a nonprofit credit counselor, a law firm familiar with ways to avoid bankruptcy, and/or a reputable financial advisor before making any major financial decisions.

“The key is to get multiple perspectives so you can make an informed decision that’s best for your unique financial situation,” Richner said.

Finance the lives of your adult children

“Helicopter parents [and] Demanding children have produced a generation of offspring who are not financially independent of their parents,” said Kathleen Owens, financial advisor at Aurora Financial Planning. “It’s a very big social problem.”

To solve this problem in your own life, limit your generosity and set limits to your children to end the cycle.

Seeks

“I’ve seen many people experience financial difficulties over the years, and I’ve seen a variety of different causes for their problems, but by far the most common cause of financial problems in my experience is addiction,” said Ziga Breznik, owner and research director at Public Finance International.

“Of course, drug addiction and gambling are among the most financially debilitating, but it’s equally true of alcohol and even things like smoking. You’d be surprised how much debt a chain smoker can get into when they’re on 40 a day. I’ve dealt with people who spent $15,000 plus a year on cigarettes and the worst part was they were so addicted they didn’t even realize how much money they were wasting.”

The solution to this problem? Get Help Quitting!

fear

“A very common problem is when people are afraid to face their finances,” said Alex Caswell, wealth planner at RHS Financial. “This leads to problems such as insufficient saving, debt, missed investment opportunities, and an overall unhealthy and stressful relationship with money. They don’t look at their bank statements, don’t evaluate how much they’re spending, and avoid making important decisions about their money for fear of what they’ll find out.”

Dissolve your anxiety by taking small steps to take control of your financial life.

“Simple things like checking your bank statement once a month can lead to budgeting,” Caswell said. “Start small and focus on building a good habit, then go bigger. Don’t be hard on yourself about this. Understand that it won’t work right away, but with enough time and focus it will get better.”

More from GOBankingRates

About the author

Nicole Spector is a writer, editor and writer based in Los Angeles and Brooklyn. Her work has appeared in Vogue, The Atlantic, Vice and The New Yorker. She writes regularly for NBC News and Publishers Weekly. Her 2013 debut novel, Fifty Shades of Dorian Gray received critical acclaim from the likes of Fred Armisen and Ken Kalfus, and was published in the US, UK, France and Russia – although no one knows what happened to the Russian edition! She has an affinity for Twitter.

Leave a Comment